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« on: October 15, 2013, 09:09:23 AM »
I have had enough people email and ask me how & how much I pay and or should charge for shipping, when thinking about starting a kickstarter. I put together a few lessons and tips that I think might help those of you who may have questions about shipping.
NOTICE:
All of the following info is for educational purposes only. Shipping and related cost vary per individual and per location. Use this info only to fashion a system that works for you.
Three Golden Rules of Kickstarter Shipping (if you following these rules, your likelihood of failure because of bankruptcy goes WAY down)
1. It is as sure as the law of gravity that people are going to get angry and bitch about your shipping prices, even if it is free.
You are NEVER going to make everybody happy, so don't live in a fantasy world in which you think you will. As longs as you are following these three rules your shipping prices are fair for both you and your backer. Most individuals don't realize the the WORST thing you could do for both YOU and your BACKERS is lower your shipping rates (below actual shipping rates) just because one or a few people are absolute jerks about life in general. Doing this will not only put financial strain on you, it will also greatly increase the chances of your project become one of those projects that funds but never delivers.
2. DO NOT try to make a profit from shipping.
Shipping with the USPS is already high enough. Make sure your product doesn't suck in the first place, that way you have collateral to justify your prices.
3. Charge people what shipping cost you.
Shipping rates are different for EVERYONE. Just because a Small Flat Rate costs $X for Joe Blow in Minnesota it doesn't mean it will be the same for you. ALL postage rates fluctuate depending on how you end up paying for the postage. If your the small project creator that has a 100 or so backers, walking up to you local USPS with a wheel barrel might be the way to go. But you will be charged a higher price for shipping than someone who sits at home in the skibs and pays for postage from a service like Stamps.com. Different companies get different bulk postage rates.
Any shipping rates that you are given (even mine) should be taken as a "good starting point". You MUST figure out what shipping will cost you in what ever form you are going to ship in.
To Fulfillment Center or Not to Fulfillment Center
Deciding weather or not to use a fulfillment center or not is up to you, and it always comes back to time and money. I personally think that EVERY project creator should at least to one project all by their self, so that they go through the process and learn the ins and outs of shipping playing cards. This way if you decide to go with a fulfillment center you will be the expert on shipping playing cards not them.
For the Federal 52 Part I I fulfilled it all by myself. This was and still is currently one of the worst experiences of my life. I am so thankful I did it, but I am so thankful that I'm NOT doing it for part II.
A cost that everyone overlooks and backers thumb their noses at is Shipping and Handling. Shipping and handling is an abstract commodity that you SHOULD NOT over look.
Time / Money Lost while fulfilling.
The following example is a crystal clear reason why I will be using a fulfillment center for my part II fulfillment. Your project may be different, so you should weigh the cost using your bank account and time as the bases.
Federal 52 Raised = $149,156.00 during it's 40 day campaign period
Backerkit Period = $15,728.00 during a two week post ordering period
Total Capital Raised in a 54 day period = $164,884
I worked an estimated 200+hours during that time period doing: Design, Answering Backers, Kissing Babies and Shaking Hands, making sure my wife didn't kill me.
$164,884 / 200hrs = $824.00 per hour
(obviously this number is different with EVERY project but the equation is the same)
Hour spent fulfilling packages = 140+ (2970 orders)
During the fulfillment time I was making $0 and could have been preparing for my next project.
Money lost while fulfilling = $115,360
That above number makes it a NO Brainer for me to pay a fulfillment house, even if they charge me double, it is absolutely worth my time.
How to estimate shipping cost
Shipping for your project will roughly come out to %16 - %18 of your total pledge raised.
I raised $164,884 for the Federal 52 Part I project and spent $27,000 on postage and fulfillment.
Below I have created a simple matrix of what I paid for domestic and international shipping.
Again, these are my rates and should NOT be taken as yours.
Allowances:
- These are postage rate calculated using Stamps.com
- All International shipping rates are calculated from a Texas Zip code of 78883 shipping to France, obviously shipping to somewhere like Canada will not be the same cost but you are only allowed to enter one dollar amount for shipping on Kickstarter, so you need to find a number that works for both France and your next door neighbor.
See the attachments for Shipping table. I don't know how to create tables so I had to just attach the doc.